SIE practice questionmediumUITs
A distinguishing characteristic of a unit investment trust (UIT) compared to a mutual fund is that a UIT:
- AInvests exclusively in real estate
- BContinuously issues and redeems shares at NAV
- CTrades on exchanges like a stock
- DIs not actively managed after its initial portfolio is set✓ Correct answer
Explanation
Why D — Is not actively managed after its initial portfolio is set
UITs have fixed portfolios and are not managed after creation. Mutual funds are actively managed, closed-end funds trade on exchanges, and UITs may hold various securities.
Turn it into reps
Reading one answer is not the same as being ready
Lucky the Banker is a free practice app with 1,867+ SIE questions, weak-area tracking, and timed mock exams. No credit card, no paywall.
Spot an error in this question or explanation? Tell us — we fix these fast.
Related Investment Companies & Packaged Products questions
- Upon maturity, a unit investment trust (UIT) typically:
- Why might an investor choose an index ETF over an actively managed mutual fund?
- Which of the following best describes an equity REIT?
- An investor trades ETF shares during market hours. How does this compare to open-end mutual funds?
- A hybrid REIT combines the features of which two types of REITs?
- Which of the following is a true statement about ETF share creation and redemption?
- Which is NOT a feature of most publicly traded REITs?
- A client redeems shares in an open-end mutual fund. When is the price set for the redemption?